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Sunday, October 28, 2007

Aquisition Time Again


Those hungry homecare companies are at it again. This time, Apria Healthcare Group Inc. announced on October 15 it has purchased Coram Healthcare, a privately-held national provider of home infusion and specialty pharmaceutical services, for $350 million. Coram is a home healthcare company that provides factor, but is best known for its top notch home nursing services. Indeed, this shining reputation was one of many qualities which attracted Apria. The acquisition will create the leading, nationwide home infusion provider. A bigger attraction? Apria can now enter the specialty pharmacy market, which seems to be attracting everyone these days. This means they can benefit from Coram's position as seller of factor in the hemophilia marketplace. Even insurance companies themselves are opening up their own specialty pharmacies, the very entities they reimburse!

As we've been predicting for the three years, there have been continued aquisitions as hemophilia home healthcare companies, whose profits are being squeezed by shrinking government and private insurance budgets, struggle to survive.

But both Coram and Apria view the aquisition positively. From the Coram website: "This is a transformative event for Apria Healthcare," said Lawrence M. Higby, Chief Executive Officer of Apria Healthcare. "The transaction supports our strategy of diversifying our service offering by adding and expanding complementary product lines that fit well with our core competencies. In addition, this expansion makes Apria significantly less reliant on government reimbursement policies, since government payors will represent a smaller percentage of our overall business. As a leading provider in the home infusion industry, Coram has long been known for its patient care-focused reputation, clinical leadership and innovative programs which benefit patients, manufacturers, physicians and payors alike. We believe the combination will enable us to serve our combined patient and customer base even better."

Good news for hemophilia patients of Coram: Coram's current management team will stay in place to coordinate the integration of the two companies' infusion businesses. This should ensure that the special needs of hemophilia patients are not left in inexperienced hands.

For more information, visit www.apria.com and www.coramhealthcare.com. And stay tuned for more mergers, which are sure to continue.

Great Book I just read: The Ghost Map, by Steven Johnson. This is the fascinating account of the cholera epidemic that hit London in 1854. The simple tossing of a soiled diaper by the mother of an infected infant into a local cesspool used by neighbors led to an epidemic that wiped out whole families in hours, hundreds in a matter of days, and thousands as the weeks dragged on. More than just a recording of this horrible event, author Johnson has the reader accompany Dr. John Snow, a physician of incredible brilliance and courage, as he bucks tremendous professional pressure and traditional medical wisdom that cholera is transmitted via air, and seeks to finds its true source, at a time in history when microbes were not even known.

Johnson skillfully shows how the explosive growth of cities reaped an environment ripe for bacterial disaster; London had 2 million people, and no public sewer system. With citizens emptying human waste directly into the Thames, the city's water supply was tainted. But it took an incredible convergence of truth seekers, including John Snow, to fight the public health bureau, and discover the true source: the Broad Street pump.

Snow's groundbreaking research and methods are still used today, and brought about a permanent change in our understanding of how infectious disease is spread. This is an amazing book! I learned so much, and can see that major cities in the developing world are not unlike London only 150 years ago. This simultaneously disturbs me, in this day and age, but also gives me hope for the exploding cities of the world like Mexico City, Delhi, and Dhaka. Johnson's otherwise perfect book is marred only in his conclusion/epilogue, which gets unfocused as he tries to relate the story to every single comtemporary event, in a preachy lecture. A+ content, B+ style.

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